MARKET COMMENTARY
Natural rubber in the Indian market is riding high over the paucity of the product. RSS4 grade rubber flared up to a nine month high in the physical market last week bolstered by limited arrivals as heavy monsoon rains in the major rubber growing areas in Kerala disrupted the production process. NMCE rubber futures jumped as well before succumbing to profit booking. Sharp rise in crude oil prices aided the sentiments as well. However, decline in consumption and contracting auto sales in the country is likely to weigh on sentiments. Moreover, with dearth of supplies in the local market and lower natural rubber prices in the overseas market may probably prompts the consuming industries to resort to import. The difference between the prices prevailing in the local and international market has significantly widened with jump in natural rubber prices in the Indian market.
MARKET NEWS
The Rubber Board sets target of bringing 4.5 lakh hectares of land under rubber cultivation in the north eastern region.
Natural rubber inventories in the warehouses monitored by SHFE rose by 109 tonnes to 114230 tonnes last week.
According to Rubber Board, natural rubber imports into India fell 4.97 percent on year to 19,695 tonnes in June, while production also fell 12.9 percent to 54,000 tonnes in the same period. Consumption declined 2.3 percent to 82,000 tonnes in June.
China, the world’s largest natural rubber importer, imported 130,000 metric tons of the material in June this year, 18.8% less than in the corresponding period of last year, according to the statistics released by the General Administration of Customs.
Thai Deputy Prime Minister/Agriculture Minister Yukol Limlaemthong urged all parties to systematically deal with Thailand’s declining rubber prices, focusing on reducing production costs as the priority.
Malaysia’s natural rubber production in May rose 16.6 per cent to 50,016 from 42,881 tonnes recorded in April.
Car sales in India fell for a record eighth month in row in June with a dip of 9 percent as economic slowdown and low consumer sentiments continue to hit demand.
TECHNICAL VIEW
RUBBER Aug NMCE
Even as the trend stays positive, some more corrective moves are probably in store before resuming uptrend. However, such downsides extending beyond 18000 levels may induce weakness.
TURNAROUND
|
Resistances |
LEVELS |
Supports |
|
18600-18700 |
19000-18000 |
18250/18100 |
|
18850/19000 |
|
18000/17850 |
|
19250/19430 |
|
17650/17500 |
Source: Geojit Comtrade
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